Law: Wealth Tax Act, 1957

Section: PartI of ScheduleI

Wealth tax---- Additional wealth tax--Exemption--Land and building used for business--­Meaning of "business "---Agricultural activity amounts to business--Assessee carrying on agriculture and ginning factory---Entitled to exemption from additional wealth tax---Indian Wealth Tax Act, 1957, Sched. I. Paragraph B of Part I of Schedule I to the Wealth Tax Act, 1957, which provides for the levy of additional wealth tax specifically excludes land and building used for the' purpose of the business or profession of the assessee, even when such lands are agricultural lands and are situated within 8 kms. of the municipal limits of a city. The finding recorded by the Tribunal on this question as to whether the land used is for the business purpose is a finding of fact. That agriculture can also constitute business cannot be doubted. The Supreme Court in the case of State of Andhra Pradesh v. H. Abdul Bakshi &, Bros. (1964) 15 STC 644 held that "the expression 'business though extensively used, is a word of indefinite import". In taxing statutes it is used in the sense of an occupation or profession which occupies the time, attention and labour of a person, formally with the object of making profit. To regard an activity as business, there must be a course of dealings, either actually continued or contemplated to be continued with a profit motive, and not-for sport or pleasure. The carrying on of activity of agriculture which. necessarily involves time, attention and labour, is to be regarded as business if it is done with a profit motive and not for sport or pleasure: Held, that having regard to the law enunciated by the Supreme Court on the scope of the term "business" and the finding recorded by the Tribunal that the assessee was carrying on business in agriculture and was carrying on business of ginning factory on the land where agricultural activity was not carried on the assessee was entitled to exemption from additional wealth tax. JUDGMENT R. JAYASIMHA BABU, J.---Two questions have been referred to us at the instance of the Revenue: "(1) Whether, on the facts and in the circumstances of the case, the Tribunal is right in law in holding that the additional…

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